Charlie-1 Appraisal Well Update

27^th December 2019

 

88 Energy Limited 

 

Charlie-1 Appraisal Well Update

 

88 Energy Limited (ASX: 88E) ("88 Energy" or the "Company") provides the following update related to the upcoming drilling of the Charlie-1 appraisal well at Project Icewine, located on the Central North Slope, Alaska.

 

Highlights

·    Initial snow trail from Dalton Highway complete

·    Ice road construction on track to commence within days

·    Operational activity for Charlie-1 progressing to plan for February 2020 spud

 

Operations Update

The Nordic Rig 3 will exit the Dalton Highway approximately 20 miles south of Deadhorse before it begins its 30-mile journey on an ice road to the Charlie-1 location. Construction is complete for the initial snow trail to the first lake that will be utilised for building the ice road. Production of the ice road itself is scheduled to commence prior to the end of 2019, weather permitting.

 

Everything is proceeding as planned ahead of the scheduled February 2020 spud date.

 

88 Energy Managing Director, Dave Wall commented: "It has been a successful year for the Company, having matured part of the conventional potential at Project Icewine to the point of a farm-out that makes a lot of sense for our shareholders. We are now on the cusp of drilling a potentially transformational well, Charlie-1, in the first quarter of 2020 and are looking forward to a safe and successful operation."

 

About the Charlie-1 Appraisal Well

The Charlie-1 appraisal well has been designed as a step out appraisal of a well drilled in 1991 by BP Exploration (Alaska) Inc called Malguk-1. Malguk-1 encountered oil shows with elevated resistivity and mud gas readings over multiple horizons during drilling but was not tested due to complications towards the end of operations, which resulted in lack of time before the close of the winter drilling season. It was also drilled using vintage 2D seismic, which was insufficient to adequately determine the extent of any of the prospective targets encountered.

 

88 Energy subsequently undertook revised petrophysical analysis, which identified what is interpreted as bypassed pay in the Malguk-1 well. 88E also completed acquisition of modern 3D seismic in 2018, in order to determine the extent of the discovered oil accumulations. Charlie-1 will intersect seven stacked prospects, four of which are interpreted as oil bearing in Malguk‑1 and are therefore considered appraisal targets. 88 Energy will operate Charlie-1, via its 100% owned subsidiary Accumulate Energy Alaska, Inc, with cost of the well to be funded by Premier Oil Plc up to US$23m under a recent farm-out agreement. Drilling is scheduled to commence in February 2020 with flow testing anticipated to conclude in April 2020. The total Gross Mean Prospective Resource across the seven stacked targets to be intersected by Charlie-1 is 1.6 billion barrels of oil (480 million barrels net to 88E). Refer announcement dated 23^rd August.

 

Cautionary Statement: The estimated quantities of petroleum that may be potentially recovered by the application of a future development project relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration, appraisal and evaluation are required to determine the existence of a significant quantity of potentially movable hydrocarbons.

 

CHARLIE-1 TARGETS	Prospective Oil Resource (MMBO): Post Farm-Out (Aug '19)
	Horizon/Play	Low	Best	High	Gross Mean	Net Mean to 88E
Indigo Discovery	Schrader / Topset	225	358	543	374	112
Charlie Prospect	Schrader / Topset	126	201	304	210	63
Lima Discovery / Prospect (stacked)	Seabee / Apron Fan	105	323	713	376	113
Stellar Prospect / Discovery (stacked)	Torok / Fan Channel	320	604	999	639	192
CHARLIE-1 APPRAISAL WELL TOTAL					1,599	480

 

A graphic showing the proposed Charlie-1 well location and the targets referred to in the table above can be viewed at the following link - http://www.rns-pdf.londonstockexchange.com/rns/9893X_1-2019-12-24.pdf

 

Media and Investor Relations:

 

88 Energy Ltd

Dave Wall, Managing Director                                                   Tel: +61 8 9485 0990

  Email: [email protected] 

 

Finlay Thomson, Investor Relations                                         Tel: +44 7976 248471

 

Hartleys Ltd

Dale Bryan                                                                                  Tel: + 61 8 9268 2829

 

Cenkos Securities                                                                    Tel: + 44 131 220 6939

Neil McDonald/Derrick Lee